Trade Extensions Customer Event: From Bicycles to Airplanes

Sheena Smith, vice president of client services, and I will be covering the Trade Extensions U.S. Customer Event, focused on the topic of “Managing Complexity,” live throughout the day. (Expect some additional analysis and commentary later in the week.) We won’t be mentioning customer names but instead will share a blinded and aggregated view of what advanced procurement organizations are doing with Trade Extensions.

For those who don’t know Trade Extensions, the vendor is an entire class by itself from a sourcing perspective. No other provider comes close to embracing the same level of scale and complexity in bridging sourcing and supply chain decision making in the areas of complex data collection, the application of constraints and scenario award analysis. (To learn more about Trade Extensions, please see our related articles below.)

To explain how Trade Extensions fits into a sourcing technology arsenal, let’s start with an analogy. This morning, a Trade Extensions client explained its progression to using the toolset. The organization first started 20 years ago using technology to support its sourcing efforts, primarily in the transportation area. This first approach, using Excel, “was like a simple bicycle.”

The next level of progression came with relational databases and Excel/Access for analysis, which was like “a bike with multiple speeds.” Next up was “the car,” or a first-generation e-sourcing tool that supported simple analysis and data collection and reporting. A descendent of this simple toolset is still in use today at the organization for simple bids.

But then the organization upgraded to the “airplane,” using Trade Extensions for complex bids that represent roughly 30 projects per year. These include between 10 to 100 bidders each, 50 to 5,000 lots and up to hundreds of thousands of individual bids per event. Some events leverage up to 100 optimization scenarios each.

Of course, with Trade Extensions, “you can still taxi” next door as you would with a plane, but that’s “overkill” for simple projects. Hence the organization uses a portfolio approach to strategic sourcing enablement through multiple technologies, reserving “the jet” for when it’s needed most.

Stay tuned for more coverage throughout the day and deeper analysis later in the week.